Put Marcos Francisco Vilas Boas Buzo and Fernanda Lazzarini – 02/07/2020

On June 15, Normative Instruction No. 81, of June 10, 2020, was published in the Official Gazette of the Union (“IN 81”), of the National Department of Business Registration and Integration (“DREI”), which reviews the guidelines on the regulation of business registration, as well as all relevant legislation published by DREI since 2013.

With IN 81, the general rules of the Public Registry of Companies were simplified to a single instruction, repealing 44 normative instructions and 12 circular letters.

In addition to being a way of concentrating all provisions in a single instrument, IN 81 also reduces bureaucracy and innovates several matters that aim to bring greater clarity, efficiency and security to entrepreneurs and investors, in addition to standardizing the decisions of commercial boards. Among the innovations, we understand the following as the most relevant:

1. Prior government authorization: The incorporation, alteration and closure of individual entrepreneurs, EIRELI, cooperatives and limited liability companies, which require authorization from a professional body, do not depend on prior authorization for filing the act with the commercial board. However, after registration, the competent body must be notified, and this measure does not apply in cases where authorization from the National Defense Council is required;
2. Participation of Foreigners: Some changes have been made regarding the participation of foreigners in national companies, among which we highlight: (i) filing of acts of individual entrepreneurs, EIRELI, limited liability companies and cooperatives, which have participation of foreign individuals must be accompanied by a simple copy of an identity document issued by a Brazilian authority; if the document has not yet been issued, a copy of the request must be attached; (ii) individuals residing abroad, whether national or foreign, may file a power of attorney for their representative with the commercial board; and (iii) foreign legal entities may also file a power of attorney, but must present proof of their incorporation and legal existence.
3. Business Name: EIRELI and limited liability companies are no longer required to have the main activity carried out in their corporate name.
4. Exemptions: The acts registered and filed are exempt from: (i) notarization, in which case the trade board employee must verify whether the signature on the personal document is the same as that present in the act or by means of a face-to-face signature; and (ii) authentication of a simple copy, which may also be performed by the trade board employee by comparing the original with the copy, or by means of a declaration signed by a lawyer, accountant or accounting technician.
5. Digital Record: Commercial boards may adopt exclusively digital registration or coexist with traditional methods.
6. Electronic Signature: Commercial boards, at their sole discretion, may accept electronic signatures, provided that they are signed by an entity accredited by ICP-Brasil and that they include the date and time of the signature.
7. Automatic Registration: Filing of articles of incorporation, amendments and termination of limited liability companies, EIRELIs, cooperatives and individual entrepreneurs will be automatically approved if they follow the standardized clauses, as per the registration manual. It is worth noting that cases involving spin-offs, transformations and mergers cannot have automatic registration approved. Furthermore, the commercial boards may carry out a subsequent examination and request corrections to the acts already filed.
8. Cancellation of Registration: Individual entrepreneurs, limited liability companies, EIRELIs and cooperatives that do not file any documents within a period of ten years must notify the board that they are still operating. If this is not done, the board will proceed with the cancellation of the company. It is worth noting that cancellation does not constitute a termination of the company, and therefore, the cancellation can be undone.
9. Preferential Quotas and Quotas with Unequal Values: In this regard, IN 81 allowed limited companies, as is the case with corporations, to have shares with different rights and preferences. At the same time, it was also allowed for shares to have different values, therefore allowing part of the shares to be issued for a value x and another part for a value y, thus having tax impacts and more possibilities for corporate structuring.

With IN 81 coming into effect on July 1, 2020, the standardization of rules complies with the provisions of Decree 10,139, which has been in force since February of this year. The initiative is part of the simplification and debureaucratization process implemented by the Economic Freedom Law.